Mike McConnell on how to win the cyber-war we're losing

The United States is fighting a cyber-war today, and we are losing. It's that simple. As the most wired nation on Earth, we offer the most targets of significance, yet our cyber-defenses are woefully lacking.

The problem is not one of resources; even in our current fiscal straits, we can afford to upgrade our defenses. The problem is that we lack a cohesive strategy to meet this challenge.

The stakes are enormous. To the extent that the sprawling U.S. economy inhabits a common physical space, it is in our communications networks. If an enemy disrupted our financial and accounting transactions, our equities and bond markets or our retail commerce -- or created confusion about the legitimacy of those transactions -- chaos would result. Our power grids, air and ground transportation, telecommunications, and water-filtration systems are in jeopardy as well.

These battles are not hypothetical. Google's networks were hacked in an attack that began in December and that the company said emanated from China. And recently the security firm NetWitness reported that more than 2,500 companies worldwide were compromised in a sophisticated attack launched in 2008 and aimed at proprietary corporate data. Indeed, the recent Cyber Shock Wave simulation revealed what those of us involved in national security policy have long feared: For all our war games and strategy documents focused on traditional warfare, we have yet to address the most basic questions about cyber-conflicts.

What is the right strategy for this most modern of wars? Look to history. During the Cold War, when the United States faced an existential threat from the Soviet Union, we relied on deterrence to protect ourselves from nuclear attack. Later, as the East-West stalemate ended and nuclear weapons proliferated, some argued that preemption made more sense in an age of global terrorism.

The cyber-war mirrors the nuclear challenge in terms of the potential economic and psychological effects. So, should our strategy be deterrence or preemption? The answer: both. Depending on the nature of the threat, we can deploy aspects of either approach to defend America in cyberspace.

During the Cold War, deterrence was based on a few key elements: attribution (understanding who attacked us), location (knowing where a strike came from), response (being able to respond, even if attacked first) and transparency (the enemy's knowledge of our capability and intent to counter with massive force).

Against the Soviets, we dealt with the attribution and location challenges by developing human intelligence behind the Iron Curtain and by fielding early-warning radar systems, reconnaissance satellites and undersea listening posts to monitor threats. We invested heavily in our response capabilities with intercontinental ballistic missiles, submarines and long-range bombers, as well as command-and-control systems and specialized staffs to run them. The resources available were commensurate with the challenge at hand -- as must be the case in cyberspace.

Just as important was the softer side of our national security strategy: the policies, treaties and diplomatic efforts that underpinned containment and deterrence. Our alliances, such as NATO, made clear that a strike on one would be a strike on all and would be met with massive retaliation. This unambiguous intent, together with our ability to monitor and respond, provided a credible nuclear deterrent that served us well.

How do we apply deterrence in the cyber-age? For one, we must clearly express our intent. Secretary of State Hillary Rodham Clinton offered a succinct statement to that effect last month in Washington, in a speech on Internet freedom. "Countries or individuals that engage in cyber-attacks should face consequences and international condemnation," she said. "In an Internet-connected world, an attack on one nation's networks can be an attack on all."

That was a promising move, but it means little unless we back it up with practical policies and international legal agreements to define norms and identify consequences for destructive behavior in cyberspace. We began examining these issues through the Comprehensive National Cybersecurity Initiative, launched during the George W. Bush administration, but more work is needed on outlining how, when and where we would respond to an attack. For now, we have a response mechanism in name only.

The United States must also translate our intent into capabilities. We need to develop an early-warning system to monitor cyberspace, identify intrusions and locate the source of attacks with a trail of evidence that can support diplomatic, military and legal options -- and we must be able to do this in milliseconds. More specifically, we need to reengineer the Internet to make attribution, geolocation, intelligence analysis and impact assessment -- who did it, from where, why and what was the result -- more manageable. The technologies are already available from public and private sources and can be further developed if we have the will to build them into our systems and to work with our allies and trading partners so they will do the same.